Investors Gain ₦3.97trn As NGX All-Share Index Rises 5.62% In May

The Nigerian equities market delivered a strong performance in May 2025, with investors recording a cumulative gain of ₦3.97tn, driven by a 5.62 per cent month-to-date (MTD) rise in the All-Share Index (ASI) of the Nigerian Exchange Limited (NGX).

This surge reflects growing domestic investor confidence, bolstered by favorable policy direction, a wave of strategic fundraising activities by banks, and diminishing appeal of alternative investment vehicles.

At the close of trading on May 30, the ASI stood at 111,742.01 points, up from 105,800.85 points at the start of the month.

The corresponding market capitalization also rose significantly, increasing from ₦66.496tn to ₦70.462tn, underlining the strength and resilience of Nigeria’s capital market amid economic headwinds such as high inflation, currency depreciation, and political uncertainty.

This performance stands out against a backdrop of persistent economic concerns, including rising inflation, a weakening naira, and security-related instability across various parts of the country.

Despite these headwinds, the equities market demonstrated remarkable resilience, with investor optimism buoyed by a series of structural reforms and developments in the financial sector.

One of the major catalysts behind the May rally was the ongoing capital-raising initiatives by Nigerian banks, following the Central Bank of Nigeria’s (CBN) announcement of revised minimum capital requirements.

Banks licensed to operate internationally are now required to have a minimum capital base of ₦500bn, while national banks must meet a ₦200bn threshold. This directive prompted a wave of fundraising activities through public offers, rights issues, private placements, and listings by introduction, most of which were facilitated by the NGX.

These initiatives not only positioned banks to comply with the new regulatory thresholds but also enhanced their growth prospects, drawing attention from both retail and institutional investors. The flurry of capital market activity strengthened overall liquidity and provided fresh momentum for the equities market.

In addition to the capital reforms, the monetary environment also favored equities. With money market yields trailing behind 2024 levels, investors seeking higher returns increasingly turned to the stock market, especially during the ongoing earnings season.

Speaking on the market’s performance, Executive Vice Chairman of Hicap Securities Limited, Mr. David Adonri in a chat with THE WHISTLER noted that dividend expectations during earnings season played a major role in driving demand.

“Most companies, especially banks, released their half-year results during the quarter. The market normally sustains positive sentiment during the earnings season,” he explained.

Adonri also emphasized that despite political uncertainties, investors remain optimistic, focusing on long-term gains rather than short-term disruptions. “The equities market is defying current political uncertainties because investors are futuristic. The prospect for a favorable yield environment is bright,” he said.

Managing Director of Arthur Steven Asset Management Limited, Mr. Olatunde Amolegbe highlighted a significant demographic shift in the structure of the Nigerian market. He observed that local institutional and retail investors now dominate the NGX, a sharp reversal from previous years when foreign portfolio investors held the upper hand.

“This shift has naturally reduced volatility in stock prices, as local investors tend to have more faith in the market. That’s why you see the NGX ASI continuing to rise despite all the uncertainties in the environment,” Amolegbe explained.

He further pointed out that optimism about economic policy reforms—particularly those designed to attract foreign investment—has been a primary trigger for the market’s recent rally. “Some of these policies will also lead to a short-term increase in inflation levels, and typically, stock prices tend to rise along with inflation,” he added.

The overall sentiment across the capital market remains positive, as investor confidence builds on the back of corporate earnings, regulatory clarity, and an increasingly supportive policy environment.

As Nigeria navigates complex economic terrain, the sustained growth of the equities market in May offers a glimpse of the resilience and potential that lie ahead for the NGX and its participants.

Investors Gain ₦3.97trn As NGX All-Share Index Rises 5.62% In May is first published on The Whistler Newspaper